The Minns Labor Government is delivering immediate financial relief to thousands of organisations across the community services sector, by reducing the levy for the Community Services Portable Long Service Leave Scheme.
The Government will reduce the levy by almost 25% in the 2025-2026 financial year.
This will save the sector approximately $50 million for the current financial year.
The reduction will provide vital budget relief to community service organisations, including not-for-profit disability providers and social service organisations, enabling them to redirect resources to meet rising operational costs such as fuel and other external pressures.
Based on projections this will save a small organisation with 10 employees up to $2477.72 in the 2025-2026 financial year and a medium sized organisation with 100 employees up to $16,927.
The first levy payment will be able to be paid to the Long Service Leave Corporation later this month from 29 April, with a final due date of 31 May.
The Minns Labor Government delivered the Portable Long Service Leave Scheme to support 250,000 community service workers. which is estimated to employ one in every 12 women working in NSW.
The new scheme ensures these workers have access to their long service regardless of which employer they work for within the sector.
In a sector where short-term contracts are common, workers rarely spend enough time in the same workplace to access their long service leave. These workers currently lose all accrued long service leave when they change employers.
The Government's reform will encourage retention in the sector by reducing burnout and fatigue for our dedicated community sector workers, as well as saving organisations on training and recruiting costs.
The portable long service scheme was the subject of extensive consultation with employers, peak organisations, and workers. The Government acknowledges the significant work of the Australian Services Union, National Disability Services (NDS), NSW Council of Social Service (NCOSS), and other non-government sector organisations in designing this scheme.
Through supporting workforce stability, recruitment and retention, the roll-out of the community services sector scheme is helping to build a better NSW by delivering more reliable services across NSW, benefiting workers, employers and communities across the state.
The levy relief has been determined in accordance with actuarial advice to ensure there is sufficient funding to meet workers' future leave entitlements and ensure the long-term viability of the scheme.
The Government will also monitor and review the levy settings over the first two years of the scheme with the scheme's long-term viability being the key priority.
Minister for Industrial Relations and Work Health and Safety Sophie Cotsis said:
"The Minns Labor Government has listened closely to the community services sector and understands the financial pressures many organisations are facing at present which is why we have opted to give the sector financial relief in this tough economic climate.
"The new levy setting aims to safeguard viability and the integrity of the scheme, and a sustainable levy model ensures we can deliver a strong reliable system for our community carers.
"The community services sector delivers essential services to some of the most vulnerable in our community and the key to making those services work is the people who deliver them.
"We've listened to the workers in this sector including the women who make up 75% of this workforce and have been calling for this reform to help minimise burnout and fatigue.
"This approach also tackles recruitment and retention issues by incentivising workers to stay in the industry with the confidence that their long service entitlements move with them from job to job."
Minister for Families and Communities and Disability Inclusion, Kate Washington said:
"Our government understands the financial pressure facing community services right now. This decision will relieve some of that pressure, without compromising the future of workers' leave entitlements.
"A stronger and more stable workforce is better placed to deliver high-quality supports within our communities. We are grateful for the Australian Services Union, National Disability Services and the NSW Council of Social Services' advocacy and collaboration."
Executive Director of the NSW Long Service Corporation Lauren Nagal said:
"This phased levy approach provides immediate relief to employers while safeguarding the integrity and viability of the scheme. Importantly, it will not impact workers' entitlements, including how service accrues or the value of leave they are entitled to claim.
"Our teams will continuously monitor and review the levy settings over the first two years to ensure employers are meeting their obligations and to support a smooth transition into the Scheme."
Chief Executive Officer, NSW Council of Social Service Cara Varian said:
"With the NSW social service sector under immense pressure, this temporary reduction in the levy provides desperately needed relief. Some front-line organisations are on the brink of closing their doors. In the face of fuel security uncertainty, this announcement will help ensure front-line organisations can continue to support people and families most in need across NSW".
State Manager, National Disability Services, Lowri Williams said:
"National Disability Services (NDS) welcomes the NSW Government decision to temporarily reduce the portable long service leave levy for community service employers, including disability service providers. This is an important and timely step that recognises the financial pressure facing disability service providers while maintaining access to portable long service leave entitlements for workers."
"NDS strongly supports a secure, valued workforce. This temporary levy reduction is a practical response to the real financial pressure facing disability providers and ensure continuity of supports to people with disability across the state," said Lowri Williams, State Manager NSW. "It protects worker entitlements while giving organisations the breathing space they need to keep delivering quality supports."
"The original levy setting would have created an immediate and unsustainable cost shock for many providers already operating under tight margins. The temporary reduction acknowledges these realities and helps protect service continuity for people with disability and communities across NSW."
"NDS thanks the NSW Government, particularly Minister Cotsis and her team, for their ongoing engagement with the sector and for progressing this transitional arrangement through government".
ASU NSW Secretary, Angus McFarland said:
"Portable long service leave will recognise the service of thousands of dedicated community sector workers to their industry and the people of NSW that they support.
"This reform, long campaigned for by workers, will bring NSW into line with ACT, Victoria and Queensland who already have schemes in place for this sector for many years.
"As the union for community services we have always advocated for the levy contributions to be as low as possible for employers while also ensuring both sustainability of the scheme and protection of worker entitlements into the future".
"While long service leave legislation has applied to this industry for decades, workers can rarely access it due to short term contracting arrangements. This change will benefit thousands of workers across the community and provide them with better, and earlier access to this important leave entitlement".
Interaction CEO Brett Johnston said:
"I would like to thank the Government and in particular, Minister Cotsis for listening to providers within the Disability sector and working with us to address our concerns about the Portable Long Service Leave Scheme levy.
"The reduction in the levy will provide some welcome relief at a time when providers are experiencing ongoing financial hardship. This will enable us to continue to provide the highest quality services to our participants and retain learning and development opportunities for our staff.
"I look forward to continued collaboration regarding this important initiative."
